80.2K

Verified Solution

Link Copied!

Warnerwoods Company uses a perpetual inventory system. It entered into the following purchases and sales transactions for March.

Date

Activities

Units Acquired at Cost

Units Sold at Retail

Mar.

1

Beginning inventory

140

units

@ $51.80/unit

Mar.

5

Purchase

245

units

@ $56.80/unit

Mar.

9

Sales

300

units

@ $86.80/unit

Mar.

18

Purchase

105

units

@ $61.80/unit

Mar.

25

Purchase

190

units

@ $63.80/unit

Mar.

29

Sales

170

units

@ $96.80/unit

Totals

680

units

470

units

1.

Required:
1.	Compute cost of goods available for sale and the number of units available for sale.
	Cost of Goods Available for Sale # of Units Cost Per Unit Cost of Goods Available Beginning Inventory Purchases: March 5 March 18 March 25 Total $

2.	Compute the number of units in ending inventory.
	Ending Inventory Units

3.

Compute the cost assigned to ending inventory using (a) FIFO, (b) LIFO, (c) weighted average, and (d)specific identification. For specific identification, the March 9 sale consisted of 85 units from beginning inventory and 215 units from the March 5 purchase; the March 29 sale consisted of 65 units from the March 18 purchase and 105 units from the March 25 purchase. (Round your average cost per unit to 2 decimal places.)

4.	Compute gross profit earned by the company for each of the four costing methods. For specific identification, the March 9 sale consisted of 85 units from beginning inventory and 215 units from the March 5 purchase; the March 29 sale consisted of 65 units from the March 18 purchase and 105 units from the March 25 purchase. (Round average cost per unit to 2 decimal places.)

Answer & Explanation Solved by verified expert

See Answer